Abstract

While the theory of public goods points to socially suboptimal contributions by agents acting under Cournot assumptions, this externality can be rectified by the introduction of positive interdependence of actions to the individual's choice calculus. This paper draws attention to the fact that the institution of democratic voting is itself a means of transforming the individual calculus in such a way that parameter changes are evaluated as simultaneous adjustments by the group, on the side of benefits, but by the individual only, on the side of costs, thus generating optimal parameter preference in the case of identical agents.